The Sooner, The Better
by:Michael Kaunitz, CPA
The earlier you start investing, the more your nest egg will be down the road – everything held equal.
This is based solely on the principle of compounding. If you start saving at age 22, save $100 a
month and earn an 8% return until you are age 65, you will have $450,478. However, if you wait to start saving until age 32, save $100 per month and earn an 8% return until you are age 65, you will have $194,654. This $255,824 is a life changing amount at age 65, especially with the total savings difference only being $12,000 between the two examples.
Saving at an early age should not just be limited to one’s retirement. It should be applied to all aspects of life. Whether it is your child’s college education or your dream vacation home, saving early can yield more impressive results than if you were to wait until later in life to start. Just remember the magic of compounding and its potential results.
Mike can be contacted at kaunitzcpas.com
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